TechCrunch publisher Mike Arrington began writing his high-profile posts exposing the misleading ads carried by Zynga on October 31. Four days later, according to documents filed with the SEC yesterday, Zynga began issuing shares as part of its latest $15 million round of financing that included firms like the gold-standard Silicon Valley shop Kleiner Perkins Caufield & Byers (past investments: Google, Amazon, Netscape, etc.), as PaidContent points out.

Of course, it took until Nov. 6 for video to emerge of Zynga CEO Mark Pincus admitting that some of the ads his company ran were "horrible." But we'd venture to guess that Zynga's investors, now into the startup for at least $54 million, would still have gone forward with their investment even that video emerged earlier. They care no more about Zynga's murky origins than they did about those of Zynga's chief clients like MySpace (born from a spam and spyware operation) and Facebook (which paid $65 million to settle claims it was founded on stolen technology). In Silicon Valley, the sins of the past are regularly washed away by infinite promise of the all-important future.

(Pic: Zynga CEO Mark Pincus, by Joi Ito)

The AdMob deal announced today is the third largest acquisition in Google's history, behind only DoubleClick ($3.1 billion) and YouTube ($1.7 billion). But no one's really been talking about the mobile advertising network or its early-thirtysomething founder Omar Hamoui until now. Hamoui is downright anonymous.

Here's what we've learned about him based on his low internet profile and scant press clippings:

• Has all of 441 followers on Twitter. In contrast, Jason Calacanis, who sold his weblogging company for less than 1/20th as much, has 77,000 followers.
  
• 32 years old as of May.
  
• Earned a bachelor's in computer science from the University of California, Los Angeles and dropped out of the MBA program at Wharton School of Business at the University of Pennsylvania.
  
• Ran computer programming company Vertical Blue for almost four years.
  
• Senior program manager at Sony Pictures Digital, about two years.
  
• COO of startup called GoPix.
  
• Started HerBabyShower.com.
  
• Started FotoChatter, for sharing pictures between cell phones, but left the venture behind after becoming frustrated with the inefficiency of advertising his site to mobile users.
  
• Came up with AdMob as a solution to the FotoChatter advertising headaches while at Wharton, at age 28.
  
• In 2007, Bill Gates personally asked Omar Hamoui to speak at Microsoft's annual gathering of journalists, according to a July 207 Ad Age article. Gates had just bought one of Hamoui's competitors.
  
• Last year, toured Kara Swisher of All Things D through his cramped headquarters in San Mateo, a town on the San Francisco Peninsula not exactly famous as a startup hotbed. (See below).
  
• Google bought AdMob after attempting to launch a mobile ad network of its own (AdSense Mobile).

(Pic: Hamoui by Rodrigo SEPÚLVEDA SCHULZ )

The Valley fad of social network games like Mafia Wars and Farmville disguise old-school scams, Mike Arrington has been demonstrating over at TechCrunch this weekend. High-revenue don of social networking games Zynga, which makes the aforementioned Mafia Wars and Farmville, gets one-third of its revenue from various shady "commercial offers" and lead-generation systems, Arrington reports. Here's how HotOrNot founder James Hong described the social networking cash scene in a TechCrunch comment:

The offers that monetize the best are the ones that scam/trick users.... i'm pretty sure most of the money ended up getting our users hooked into auto-recurring SMS subscriptions for horoscopes and stuff.

Examples, via TechCrunch:

• "Users are offered in-game currency in exchange for filling out an IQ survey... They are told their results will be text messaged to them... and are texted a pin code to enter on the quiz. Once they've done that, they've just subscribed to a $9.99/month subscription."
  
• "Users are offered in game currency if they sign up to receive a free learning CD... The user is told they pay nothing except a $10 shipping charge. But the fine print, on a different page from checkout, tells them they are really getting a whole set of CDs and will be billed $189.95 unless they return them."

There's an entire thriving "ecosystem" devoted to these sort of "deals," the sort of thing that in a different context might just be called a "crime ring." It's a profitable network, at least for the people at the top: Arrington estimates Facebook might be taking in $50 million per year from Zygna alone.

So, social networks are basically turning in to just another snakeoil sales channel in the mold of late-night 1-800 number commercials. Which sucks not only for the marks who've been duped but, ultimately, for Facebook's investors, since taking this sort of easy cash reduces internal pressure to come up with some sort of truly innovative revenue stream.

Not to mention what it does to user trust: Who's going to want to hand over their credit card information or even cell phone number to the likes of Facebook amid all these scams? (Answer: People who passed their "IQ test" with flying colors and a useless $10/month subscription.)

The antivirus company Sophos sicced the Russian head of its Canadian antivirus lab on various scammy sites (original report) and discovered that entry-level scammers can do pretty well for themselves. Sophos snuck into the admin panel for the affiliate of one scam site , which offered free porn if you installed a nefarious video codec (really spyware). The affiliate in question made $6,500 for Aug. 2008, probably using templates and software provided by the scam network.

Another common scam involves using affiliates to sell fake prescription drugs, ostensibly from Canada. Since actual drugs aren't involved, the seller can afford to give the affiliate a 40 percent kickback; Sophos believes a single spam campaign could net $16,000 per day.

It's unclear whether Eastern Europeans can continue to con Americans into spending tons of money on completely ineffective health care "solutions," with internet propaganda, now that so many American scammers have jumped into that same game.

According to The Independent, here's the conflict: YouTube is expected to take in around $240 million in revenue from advertising this year. The problem is that this sum doesn't come close to covering the site's operating costs. Every minute of the day there are over 20 hours of video uploaded to YouTube and the costs involved with maintaining servers, bandwidth, software, etc, is astronomical, so much so that if it weren't for YouTube's "multinational sugar daddy," Google, supporting it and willing to bleed money to hold on to it as a property, YouTube would already be dead.

So whose fault is this? Yours! And mine, of course. Because we've become a bunch of spoiled little brats who refuse to pay for any content online, nor do we want to be bothered with stupid advertisements getting all up in grills during our web surfing.

We are uninterested, verging on contemptuous, of the marketing strategies that were supposed to pay for us to enjoy online services for free. We've become totally unwilling to pay for them directly, either; we simply figure that someone, somehow, will pick up the tab.

Now, let's all pause right here and take a second to look at ourselves in the mirror after reading that passage. You feeling slightly guilty? No? Me neither. Well maybe a little. But still, we're not that bad when it comes to tolerating online advertising, are we?

The fact that most people over the age of 30 doubt that online businesses can survive by offering free services is irrelevant, because most people under the age of 30 are demanding them. On messageboards and forums across the internet you can see them calling for record companies, film studios, newspapers and television channels to come up with a solution that will extend their entertainment utopia, and quick; if they don't, well, they'll find a way around it. And while many see this as a selfish, unrealistic attitude, the onus is on businesses to get themselves out of this mess because the digital medium exercises unstoppable power.

So is our little utopia going to hell? Maybe!

The news regarding YouTube's losses have caused such consternation because people simply can't believe that the third-most-popular website on the web is unable to stand alone and turn a profit. And suddenly, the magical web, whose supposed capacity to revolutionise business has attracted and continues to attract waves of ambitious entrepreneurs, may slowly be revealing itself as an arena in which only a few large companies can survive.

So what does the future of the internet look like?

Either produce something that people are willing to pay for, or come up with an idea for a free service that's so ingenious that a benevolent multinational is willing to take it off your hands.

Look, can we really help it if we demand everything online be free and will stop at nothing to get what we want for free even when it's not intended to be free? After all, the editor of Wired stole material to write a book about how all content should be free! Is there really anything more to say?

But seriously, do we agree with everything in The Independent's article? Absolutely not! Do we believe that YouTube's financial struggles are a bellwether for a widespread failing of the net in general? Absolutely not! At various points the article reads like little more than a rehashing of many of the same arguments that the old media dinosaurs having been braying endlessly over the last few years, but I'd be lying if I said that it didn't provoke me to stop and think, and for that reason you should go and read the entire piece for yourself and form your own opinion. And please feel free to share them in the comments below.

How Can YouTube Survive? [Independent]

Google has a plan to extend its dominance in search and online advertising into every part of the information economy. It's no secret — it's in the company's mission statement. But antitrust cops look askance at efforts to use market power in one field to move into another.

When Obama appeared at the Googleplex in November 2007, his candidacy was far from preordained. Gullible techies hailed his platform as "Google-friendly." Sure, Google will be helped by support for faster broadband connections. And cofounders Larry Page and Sergey Brin share a cleantech obsession with Obama.

Schmidt was so lackadaisical about courting Obama that he only endorsed him in the waning days of the campaign, threw an inaugural ball, and got rewarded with a token appointment to a science council. For those obviously halfhearted gestures, he didn't get what he wanted: a free pass on antitrust issues.

When it comes to enforcing competition laws, the White House sees Google as just another big, overweening corporation. Assistant Attorney General Christine Varney, appointed last month, mused about Google as the next big antitrust target last summer.

And sure enough, Google is facing two antitrust cases already: one about book search, and another about its board's overlap with Apple. They come after antitrust cops unexpectedly shot down a search deal with Yahoo last year.

The investigation into Apple's board, half of whom are either Google board members or Google advisors, really has to do with the mobile-phone industry. Google makes an operating system for mobile phones, but it's free, so it's hard to argue that, say, T-Mobile's G1 Googlephone competes with Apple's iPhone. But that's a red herring.

The real problem is the potential for collusion in mobile search. Google used to brag about how much search traffic the iPhone generated for it — 50 times more than any other handset, Google executives said last year. One hasn't heard Google trotting out those kinds of statistics lately. Why make it easy for government antitrust prosecutors to see the connection between Apple's iPhone sales and Google's mobile search traffic?

Google executives seem deluded about the company's antitrust risks. In a video interview with BusinessWeek, Dana Wagner, Google's top antitrust lawyer, refuses to use the word "antitrust" to describe what he does. He calls himself a "competition counsel."

Who's going to get Google out of this mess? Not its outside lawyers, Wilson Sonsini. They prepared an analysis of the kind of board conflict Google faces with Apple, which concluded that there was a high risk of collusion. When John Paczkowzki of AllThingsD called to ask questions about it, the document got yanked off of Wilson's website, and deleted from Google's cache curiously fast. Conveniently, Microsoft, which has hired the lobbying firm where Eric Schmidt's ex-girlfriend works to stir up antitrust trouble for Google, still has a copy in its search engine's cache.

To no one's shock, Yahoo's ad-dependent business struggled amidst the worst advertising market in recent history. The company is laying off another 700 employees — though, thanks to Yahoo's lousy cost controls and poor planning, they'll probably hire that many people in a couple of months. We wonder how long it will take Bartz to figure out that Yahoo's business is thoroughly broken, and not in a way that can be fixed with a few well-chosen curse words.

WPP, the advertising conglomerate, is suing Grouf and Spot Runner's other board members, charging them with a massive scheme to enrich themselves to the tune of $54 million while the online-advertising startup bled $80 million in losses. WPP is seeking $13 million in damages. (The lawsuit is embedded below.)

So many people believed Spot Runner's story — a startup ostensibly dedicated to simplifying the process of buying television ads, a challenge Grouf experienced firsthand while working on John Kerry's failed presidential campaign in 2004. Media giants from WPP to Grupo Televisa to CBS invested more than $100 million in the company — some of which WPP charges went into Grouf's pockets instead of into the company's coffers. Bob Pittman, a Spot Runner board member, is also accused of selling his shares, as are Battery Partners and Index Ventures. Spot Runner claims WPP just wants to get back its investment in a declining ad market.

Everyone loves an upstart. In 2006, as it raised its first round of venture capital, Spot Runner cast itself early on as the David against Google's Goliath as the search engine was starting to dabble in brokering television commercials.

Grouf told a gullible Kara Swisher last summer that the company was "scrappy," bragging about the low rent it paid on its headquarters on Wilshire Boulevard in Los Angeles. But the company lurched from business plan to business plan — first hiring dozens of video producers to churn out cookie-cutter TV ads, then buying a search-advertising startup, then switching from selling TV ads to small businesses to wooing national advertisers. Executives came and went, and the company laid off hundreds in waves starting last fall.

John Gentry, the company's president, blamed the economy, telling Fortune Small Business that "everyone's hard hit." But the WPP lawsuit has revealed the economy excuse as an obvious lie. Spot Runner took in $5 million in revenues in 2007 and lost $35 million. 2008 was hardly an improvement: The company took in $9 million and lost $45 million. (Spokeswoman Rosabel Tao would not comment specifically on those figures, saying that WPP's filing had "inaccuracies.") At those figures, Spot Runner didn't have anything resembling a real business, let alone one that would wax or wane with the swings of the economy.

WPP alleges that Spot Runner's executives and board members, including some of its early venture-capital backers, sold shares to new investors, pocketing the proceeds rather than putting the money in the company's treasury.

Spot Runner is now betting the company on something called Project Malibu, a digital system for buying television ads. Wait a second: Wasn't that the initial idea, to use technology to make buying TV ads easier? The fantasy of perfectly liquid markets has long entranced entrepreneurs, who can't understand why all business processes aren't as efficient as the equations they studied in college. But it's hard to imagine a business less efficient than one which loses $5 for every $1 it makes.

The picture painted by WPP charges are of a market that functioned very efficiently for Grouf and his pals. Too bad it didn't have anything to do with advertising.

Most of Facebook's surge in user numbers — they're now past 200 million — has come overseas, where it's hard for Facebook to sell ads. Earlier this year, executived decided to loosen up restrictions on the kind of ads that could be placed on their system. (A side benefit: Less money spent paying recent college graduates to review ads manually.)

Now there's a plethora of diet ads, IQ quizzes, and other cheap come-ons that populate the Web's lowest-rent advertising inventory.

Plus some really amusing stuff, like this homoerotic solicitation for Yankees fans and a six-pack-abs ad featuring Edward Norton as a neo-Nazi from American History X.

Google executive Omid Kordestani, the company's sales chief, wrote in the offiicial Google blog that cuts are concentrated in Google's sales and marketing operations, as tipsters told us earlier, and that the company had "overinvested" in areas where it had forecasted growth — growth which is not materializing. One source writes that the division that used to be DoubleClick before Google acquired the banner ad-sales network in 2007 was especially hard hit with more than 50 jobs eliminated in New York. Other sources say layoffs are spread throughout the Google empire; we've heard of at least one cut at YouTube.

A tipster writes:

A friend of mine in the San Francisco office's AdWords division (who wants to remain nameless) was laid off this morning. She also said there were 200 people total. They are still on payroll for two months and have the opportunity to apply for other jobs within the company. If they don't have another job at the end of the 60 days they get a severance package.

The 60-day payroll period sounds consistent with the advance warning an employer would be required to give employees affected by a mass layoff under state and federal laws known as WARN acts. If you know more, drop us a line.

Stone declared some time ago that Twitter.com would be an advertising-free zone. But as Peter Kafka points out on MediaMemo, Twitter has been running house ads for some time, promoting its search engine and other features.

ExecTweets is a directory of business executives who use Twitter to post short messages to their friends, fans, underlings, and sycophants. What did it take to put Stone in that last category? Why, just a little bit of cash, courtesy of John Battelle's Federated Media, an online advertising agency known for its controversial online campaigns which blur the line between editorial content and advertising. Battelle writes:

Twitter has a history of promoting applications and projects they think are interesting, relevant, or valuable regardless of any financial arrangement. Federated Media felt that Twitter should share some of the revenue associated with ExecTweets since this project is made possible using their open platform.

He'd have us believe, in other words, that Twitter is promoting ExecTweets not because it's getting paid but because Stone and company just love, love, love it. Right. And if you believe that, Battelle has an interesting topical experience to sell you.

More than anyone, Google popularized the notion that free websites could be supported by advertising, touching off the insane Web 2.0 boom that led self-promoting social media marketers to overrun San Francisco and drove venture capitalists into fits of expensive madness. If Google could give away its Web searches, why couldn't, say, Ploorkle monetize its users' ploonks?

Google didn't just serve as an example. It actively funded the free-everything boom with its AdSense ads, matching keyword buys from advertisers with every last blog and Web app.

The Google-spread delusion of "free" as the perfect price infected such lofty minds as Chris Anderson, the editor of Wired who penned first a cover story and now a book due out in July on the subject.

What does it mean for the freetards, then, that Google is starting to charge left and right?

The latest and most notable price hike came today on Google Checkout. The credit-card processing service for online merchants will soon match PayPal's fees, which run as high as 2.9 percent of a transaction.

When Checkout launched, it offered free processing for stores which spent heavily on Google ads, with the notion that free payments would lure vendors away from Amazon.com and eBay. Google is eliminating the AdWords discount, making Checkout just another PayPal clone.

Google has also raised prices on its once-free hosted computing services for startups which don't want to bother running their own servers.

The hikes have mostly hit Google's business customers. But how long before Google will raise prices for, say, extra Gmail storage? How long before it spackles ads on services previously kept pristine, as it's already done with Google News?

The advent of ads to Google News is notable. Just last summer, Google VP Marissa Mayer argued that Google News made $100 million a year from the Web search traffic the site generated, and therefore didn't need its own ads. Looks like she lost that battle with the green-eyeshades brigade. YouTube, too, is burying its videos in every imaginable form of advertising.

Google is widely expected to announce disastrously bad results for its first quarter. Industry trade groups have cut their forecasts for search advertising, Google's mainstay. Rumors of layoffs are sweeping Google's Mountain View campus. And even Google's Pollyanna CEO, Eric Schmidt, admits that the economic situation is dire.

Far more than a temporary belt-tightening, the cutbacks are a far-reaching change in mindset. It's no longer okay to invent something new and figure out how to pay for it later, as Google cofounders Larry Page and Sergey Brin once did. At today's Google, products must pay their own way, and with actual receipts, not business-model whiteboarding.

Who cares that that's not how Larry and Sergey did it? The billionaire founders are flying around the world somewhere on their private jets. The rest of Google has a business to run. And their paychecks don't come free.

Susan Wojcicki, the Google vice president who's also the sister-in-law of cofounder Sergey Brin, announced that Google would start tracking the websites people visit, wherever Google serves ads — which is something like 90 percent of the Internet worldwide. Google will then assign "interests" to those users based on their online browsing, and serve up ads accordingly.

As Google product manager Shuman Ghosemajumder explains in the clip above, Google is making it easy to modify the interest information Google stores. You can opt out, but then the "ads will be less relevant to you." (The horror!) What Ghosemajumder, Wojcicki and the rest of the Googlers are really hoping you'll do is add or subtract interests to the list rather than opt out — and thereby give Google even more information about you.

If anyone bothers, that is. In a survey of Internet users from March 2008, 91 percent of respondents said they would make use of privacy tools if better ones were available. But they are — Google's hardly a pioneer. Yahoo announced a similar opt-out scheme last year, and less than 1 percent of users bothered to visit the ad-preferences page.

The truth is that privacy is a problem everyone likes to talk about in public, and no one actually bothers with in private. It's a handy bugaboo for activist groups, a reliable topic for pundits and journalists. A trendy thing, perhaps, to whine about in online message boards.

But is it relevant to our online lives today? In an age of oversharing, when we update Facebook with every emotion and Twitter every Web page we come across, when we blog, blog, blog it all, is Google really the biggest threat — or is it us?

And if it's us, where's the preference setting to turn it off?

Of course, Google is planning to keep most of that profit. If Larry and Sergey plan to share anything more than links with the newspapers whose headlines it displays in Google News, they haven't signaled their intentions.

Good on them! If the newspapers had ever been even a tenth as cynical, opportunistic, and clever about exploiting their product and finding new advertisers as Google has, they wouldn't be in this mess. Instead of condemning Google of "stealing" their content, newspapers should be grateful that someone's making a pie — of which they can now ask for their fair share.

For example: A search for Yahoo CEO Carol Bartz on Google contains an ad for a DVD of Bartz's speeches. Can you imagine a newspaper salesforce thinking to solicit that ad, let alone running it in a timely fashion? There's a host of potential advertisers like that whom the newspaper industry has never tapped.

We're no doubt going to hear a lot of newspaper grandees groan that, like Apple in the music industry, Google will capture most of the profits from the online sale of their product. Did it ever occur to them that Apple might be reaping more of those profits because consumers think the portable convenience of the iPod and the one-click simplicity of iTunes have more value than the time-filling music itself?

Unlike the record industry, though, which for a good couple of decades had an enormously successful distribution medium in the CD, the newspapers have never come up with an electronic version of the news that is at once profitable for them and popular with consumers. Their websites are at once too large to shut down and too small to sustain them. The only newspapers seriously considering pay-to-read schemes are also-ran operations like Newsday. The right answer is embracing new sources of traffic (and hence revenue) like Google News — not shutting them off.

A few publishers understand this — generally outcasts like Dean Singleton, who's widely hated by his employees for cutting costs, and who recently killed one of his own by having his scrappy Denver Post outlast the Rocky Mountain News, which printed its final edition today. "The Internet world is a very competitive world," Singleton told the Times. "We don't have to let them take our content. We let them do so because it drives traffic." He's right: If the newspapers withdraw their headlines from Google News, scrappy Internet publications will gleefully replace them. To newspaper publishers who grew up with virtual local monopolies, this thought just doesn't occur.

Publishers should be rejoicing that Google is trying to make money off their headlines. At least someone is.

They've already lost hundreds of millions of dollars in less than a year. Executives at the cable-TV conglomerate announced the plan even as they said they were writing down Newsday's $650 million purchase price by $402 million. "We plan to end the distribution of free Web content," said Cablevision COO Tom Rutledge in a call with analysts.

What that really means: Newsday plans to end its distribution on the Web.

Employers are willing to foot the bill for subscription at work to papers like the Wall Street Journal and the Financial Times. But its inconceivable that consumers will pay for a rather ordinary product like Newsday.com, especially in a media market served by four large dailies, none of whom have announced plans to charge for their websites.

Newsday's Web traffic will surely plummet. Except for some local Long Island news, there's little Newsday readers won't find elsewhere. No doubt some enterprising local bloggers, or startups like Patch, will pick up the slack.

No wonder that a bunch of cable executives came up with this plan. With their local TV monopolies relatively undisturbed, and only limp competition from the nation's telecom oligopoly, they just can't conceive of a competitive market. If Newsday were, on its own merits, an outstanding publication, they might have a shot at charging for it. But it's not. So the cable guys are stuck doing the one thing they know how to do: Hike prices.

The Sydney Morning Herald caught Facebook redhanded running bogus ads for make-money-on-Google programs and other schemes. (Even Google says they're fraudulent.) The company's response: The ads are isolated incidents which go offline as soon as users report the scams.

If only that were true. As the Morning Herald found, the same ads keep appearing. According to Online Scams Exposed, a blog devoted to ferreting out fraudulent ads, the reason why they're showing up is a deliberate policy shift by Facebook.

The previously banned ad categories now allowed include:

* "Work-at-Home" Scams
* "Free Trial" Diet Products that bill your credit card well before the trial period ends, then refuse to let you cancel
* "Free Federal Grant Money" rackets where you pay get a list of 'secret' free grant programs (no such thing as a free lunch)
* "Free Ringtone" subscription services (The Florida Attorney General's Office had a field day with this one)
* "Free IQ Surveys" that feed you a bunch of easily answered questions before you are required to pay to see the results.
* "Cash4Gold" Programs encouraging you to shove your jewelery in an envelope and mail it in for a third of its actual value

Why would Facebook allow online scams to run on its site? The reason is obvious: It is losing money with every user it adds. Zuckerberg's creation constantly needs more servers to accommodate its growth, and revenues are not keeping pace.

So instead of delivering on Zuckerberg's 100-year change, Facebook executives are lowering their standards and letting online con artists prey on their users. It may provide a temporary boost to revenues, and allow Zuckerberg to realize his own get-rich-quick scheme. And it may be a transformative move in the world of media — just not one anyone will applaud.

(Photo of Zuckerberg by AP; photos of scam ads via Sydney Morning Herald and Online Scams Exposed)

Google's ads pick up on keywords in NonSociety, a collection of egoblogs maintained by Allison and two friends, vapid handbag designer Mary Rambin and insecure Silicon Valley heiress Meghan Asha Parikh. The search engine's ad-placing algorithms are mercilessly insightful. The current selection:

Davos, debt, and digestion. Pretty much sums up the threesome, doesn't it?

The other day, Wall Street Journal editor Robert Thomson opined about Google on the Charlie Rose Show:

But one of the — Google — I mean, the harsh way of just defining it, Google devalues everything it touches. Google is great for Google, but it's terrible for content providers, because it divides that content quantitatively rather than qualitatively. And if you are going to get people to pay for content, you have to encourage them to make qualitative decisions about that content.

As much as we hate to disagree with Thomson, we think Google has made an excellent qualitative judgment on NonSociety.

Susan Wojcicki, the millionaire sister-in-law of Brin who also holds a management role in the company, announced the job cuts in a blog post, as she laid out plans for Google to exit the business of brokering radio ads, a business it entered in 2006 when it bought dMarc Broadcasting for $102 million.

Up to 40 Googlers will lose their jobs, a small percentage of the 20,000 remaining employees at the search giant. But the real cut here is to google's ambitions.

dMarc was Google's first big move outside online advertising. It followed swiftly with announcements of forays into selling ads in newspapers, magazines, and TV. The strategy had more to do with Wall Street than with Madison Avenue, though: Google desperately needed to create the illusion for shareholders that it could tap more than just the market for Internet search ads.

Google has already pulled out of print advertising. Now radio is gone. Will TV advertising be next? Wojcicki, in her blog post, insisted that Google would keep trying to break into the TV business. The rationale: Like the clicks that give Google feedback on which ads work and which ones don't, Google can track when TV viewers change channels in the middle of a TV ad.

The feedback loop of clickstream data has made Google victorious online. The more ads it sells, the more data it has; the more data it has, the more accurate its targeting is; and the more accurate its targeting, the more money it makes for advertisers and publishers, drawing yet more ads. Microsoft and Yahoo, with a smaller base of advertisers and users, never stood a chance.

That dynamic simply doesn't exist with radio or print advertising. And the channel-switching data Google touts simply is not informative enough to shape TV-advertising campaigns.

Napoleon's rout in Russia, far from home, was followed in a few short years by defeat just outside the borders of France in Waterloo. His army was still mighty after Moscow. It was the long, cold march back home that devastated it. Could Larry and Sergey's hubris lead them to a similar defeat?